Because the screening process for its unsecured personal loans is entirely virtual, there are fewer loan underwriting costs, which means Payoff may be able to offer better interest rates and quicker turnaround times than brick-and-mortar lenders.

But not all borrowers will qualify — even if they have pristine credit.

The Costa Mesa, California-based company offers loans in less than half of U.S. states. You cannot get a loan through Payoff if you live in Alabama, Arizona, Connecticut, Delaware, Iowa, Kansas, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Hampshire, North Carolina, Ohio, Oklahoma, Rhode Island, South Dakota, Tennessee, Vermont, Virginia, Washington, West Virginia and Wisconsin.

Who is a Payoff personal loan good for?

Anyone with good to excellent credit. The minimum credit score required is 660, according to the company. That’s slightly lower than national average FICO score, which is 695. Check your credit score for free before you apply.

Consumers with a low debt-to-income ratio, that’s the amount of debt you have compared to your gross monthly income. Calculate your debt-to-income ratio before applying. Payoff says your DTI must be less than or equal to 50 percent.

Anyone looking to improve their credit score, as Payoff reports to the three major credit bureaus. A company study found customers who paid off at least $5,000 in credit card debt saw an average FICO score increase of 40 points within four months of receiving their personal loan.

Anyone who wants to improve their financial literacy. Payoff gives its borrowers a “financial personality” test created by the former chief scientist of dating site eHarmony.com. The test is intended to help empower borrowers to make better financial decisions in the future. The company also offers first-year, quarterly support calls with its “Member Experience Team.”

Who should not accept a loan

Anyone with bad credit. If you have less-than-stellar credit and you’re quoted a double-digit annual percentage rate along with a steep origination fee, you may be better off with a different type of loan.

Lending terms

When you get a loan from Payoff, you’re not actually getting the money from Payoff. Instead the company acts as a broker, screening and matching would-be borrowers with FDIC-insured First Electronic Bank, based in Sandy, Utah.

Payoff charges an origination fee for its matchmaking services. Think of it like an application fee or a processing fee — a sunk cost that may or may not seem reasonable, but it’s non-negotiable. Some, but not all lenders, charge this fee.

It offers loans that range from $5,000 to $35,000. Its personal loans carry a fixed interest rate of between 8% and 25%. The quote you receive is based on multiple factors, including credit history, the amount you’re asking for, and if you want 24, 36, 48 or 60 months to pay it off.

Payoff’s origination fee is an upfront cost taken off the top of the loan. For example, if you are approved to borrow $10,000 and you’re charged a 3% origination fee, you’ll only receive $9,700. Keep in mind, though, that you’ll be making payments on the entire $10,000. You should factor the origination charge when calculating the total amount you’re looking to borrow.

The origination fees are based on the repayment terms of your loan. A 24-month loan has a 2% origination fee, a 36-month loan has a 3% origination fee, a 48-month loan has a 4% origination fee and a 60-month loan has a 5% origination fee.

Once approved for a loan it takes two to five business days to receive the funds in your bank account.

Minimum borrower requirements

The minimum credit score to borrow is 660, but that’s not the only factor Payoff considers in evaluating an application. Would-be borrowers also must have:

A debt-to-income ratio of 50% or less.

At least three years of good credit history.

At least two open lines of credit in which you’ve made on-time payments.

Fees and penalties

Payoff charges an origination fee of 2% to 5% depending on the length of the loan that you choose.

You won’t be penalized for paying off your loan early.

There are no fees for paying by check or missed payments.

How to apply

The application process is straightforward and fast. Enter some basic information including your name, address, income and if you rent or own. You’ll also be asked how much your monthly housing costs are, if any.

Payoff then will conduct a “soft” credit check, which won’t impact your credit rating and tell you how much they suggest you borrow to pay off your credit card debt. You can sort through loan offers by monthly payment amounts or by APR.

If you select one of the displayed offers, Payoff will direct you to a more detailed application where you’ll have to fill out your employment information, Social Security number and bank account information. You’ll also have to upload two recent paystubs, a copy of your ID and a recent bank statement.

Before finalizing your loan, Payoff, like all lenders, will do a “hard” credit check, which can adversely impact your credit score.

What to do if you’re turned down

If Payoff rejects your application and you believe your credit and financial standing is strong enough, consider asking for clarification. The explanation could be as simple as a processing error. Or there may be a negative mark on your credit report you need to investigate.

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